The Nigerian naira further depreciated against the US dollar in the official foreign exchange market on Tuesday, closing at N1,604.00/$1, down from N1,599.00/$1 the previous day, according to data published by the Central Bank of Nigeria (CBN). The local currency also weakened against other major global currencies, exchanging at N2,115.25 to the British Pound, reflecting sustained pressure on the naira.
In the parallel market, the trend was similar, with the naira trading at N1,618/$1, a decline from N1,605/$1 on Monday. This data was gathered from currency dealers at the Wuse Zone 4 area of Abuja, known for its high volume of retail forex activity.
Despite the ongoing depreciation, stakeholders in the forex market remain cautiously optimistic about the broader outlook, attributing recent relative stability to regulatory efforts by the CBN.
In a statement to Nairametrics, Aminu Gwadabe, President of the Association of Bureau De Change Operators of Nigeria (ABCON), credited recent market improvements to the central bank’s ongoing reforms. “The sustained CBN intervention in the Nigerian Foreign Exchange Market (NFEM) has boosted liquidity supplies and helped in stemming the volatility and enhanced investors’ confidence,” Gwadabe said.
He also cited the impact of domestic crude oil transactions conducted in naira, noting that these arrangements had helped to ease demand pressure on the currency during turbulent periods. “The continuation of crude oil sales in naira to local refineries has also doused the escalated demand pressure on the naira during the period of the volatility, which ab initio created tension in the market,” he added.
Gwadabe pointed to wider international developments, including the suspension and revision of US tariffs on key trading partners, as factors that have supported recent gains in both global and local markets. “Both global and local markets have responded positively with considerable appreciation,” he said.
He commended the CBN’s improved data transparency, especially the recent revelation of a net foreign exchange position exceeding $6 billion, which he believes has restored a measure of clarity to the market. He also noted a 9% increase in diaspora remittances, now totalling $20.98 billion, as evidence of the success of the central bank’s supply-driven approach.
Nonetheless, Gwadabe cautioned against premature celebration, warning that substantial work remains to be done. “Despite all these positive indices, it is still yet uhuru,” he stated, urging further cooperation between monetary and fiscal authorities. He called for the implementation of “humane policies and reforms” under President Bola Tinubu’s administration to manage inflation and address the country’s wider economic and security issues.
Meanwhile, another Bureau De Change operator echoed the need for continued CBN support in the forex market to help stabilise the naira.
Some market analysts attribute the ongoing pressure on the local currency to the uncertainties surrounding government reforms and limited access to official FX channels, suggesting that investor hesitation may persist until clearer structures are in place.
